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KANPUR INSTITUTE OF TECHNOLOGY, KANPUR  QUESTION BANK-1 CLASS: MBA IInd Semeste S!"#e$t: F%n&n$%&' M&n&(ement )MBA *+

1. What do you you mean by business business finance? finance? Discuss Discuss variou variouss approaches approaches to finance finance function function.. 2. “Finance “Finance function function is concerned concerned with allocati allocating ng funds to specific specific assets assets and obtaining obtaining the best best mix of financing financing in relation to the overall valuation of the firm. Discuss. !. What What do you you underst understand and by "usi "usines nesss financ finance? e? #. What What is fina financi ncial al manage managemen mentt proces process? s? $. What is finance finance function? function? What What are are its its ob%ecti ob%ectives? ves? &. What is financi financial al management? management? What What ma%or decisi decisions ons are re'uired re'uired to to be ta(en in finance finance?? ). “ *aximi+ation *aximi+ation of profits profits is regarded regarded as the proper ob%ective ob%ective of investment investment decision, decision, but it is not as exclusive exclusive as maximi+ing shareholders- wealth. omment. /. 0xplai 0xplain n the ob%ecti ob%ective ve of financi financial al managem management ent.. . “Finance “Finance function function of a business business is closely closely related related to its other functio functions. ns. Discuss. Discuss. 1. Why is maximi+ing maximi+ing wealth a better better goal than maximi+ing profits? 11. 3ow should the finance of an enterprise enterprise be organi+ed? 12. ritically analy+es the functions of financial manager in a modern business organi+ation. 1!. What is the concept of 4time 4time value-? 5ame the techni'ues of 6ime value of money. 1#. What is time time preference preference for money? money? 1$. Define the following7 8a9 8a9 :nnuity, 8b9 Discount rate, rate, 8c9 Future value,8d9 :nnuity discount factor, 1&. “: rational human being has a time time preference for money. What are the reasons for such a preference? 1). 0xplain the mechanics of calculating calculating present value of cash flows giving giving suitable examples. 1/. What is ;is(? 3ow can ris( of an asset be calculated? 0xplain. 1. What are the types of ris( involved in an investment? investment? :naly+e the ris( and return return relationship in ta(ing
QUESTION BANK-+ CLASS: MBA IInd Semste S!"#e$t: F%n&n$%&' M&n&(ement )MBA *+

1. 2. !. #. $. &.

What do mean by appraisal of pro%ects? 0xplain the various considerations involved in such appraisal. Discuss the problems of identification, formulation, appraisal and implementation of new pro%ects. Discuss in detail the various stages involved in the execution and management of a pro%ect. Define capital budgeting. What is the need of capital budgeting? 0xplain the concept of capital budgeting and what is it-s practical utility? What do you understand capital budgeting process? 0numerate briefly the ma%or steps involved in capital  budgeting. ). “ apital "udgeting is long term planning for ma(ing and financial proposed capital outlays 0xplain. What are the limitations of its. /. Write short notes on 7 8a9 profitability index,8b9 time ad%usted rate of return, 8c9 apital rationing, 8d9 5=> vs <;;,8e9 apital expenditure,8f9=ay bac( period method,8g9 accou nting rate of return. . What is meant by financial leverage? 3ow does it magnify the revenue available for e'uity shareholders? 1. Discuss the relation between debt financing and financial leverage. 11. Distinguish between operating leverage and financial leverage. Do you thin( that they are related to capital structure?

QUESTION BANK-. CLASS: MBA IInd Semeste

S!"#e$t: F%n&n$%&' M&n&(ement )MBA *+

1. ritically examine the advantages and disadvantages of raising funds by issuing shares of different types. 2. What are debentures? What type of debentures can a %oint stoc( company issue? 0valuate debentures as a source of funds. !. "etween e'uity shares and debentures which is profitable for raising additional long term capital for a manufacturing company and why? #. What is factoring? $. Write a brief note on commercial paper as a source of finance. &. Write short notes on7 8a9 onvertible debentures,8b9 =reference share,8c9 0'uity shares,8d9 ease financing, 8e9 @elf financing, ). “ommercial "an( provides only short term finance. Do you agree? 0xplain the various forms of ban( finance. /. “easing is beneficial to both, the lessee as well as the lessor. 0xamine. . What are the main sources of finance available to industries for meeting shortAterm as well as longAterm financial re'uirements? Discuss. 1. What do you understand by capital structure? What are the ma%or determinants of capital structure? 11. Bsing imaginary figure show how to determined the value of firm under 8a9 6he 5etA
QUESTION BANK-/ CLASS: MBA Ist Semeste S!"#e$t: F%n&n$%&' M&n&(ement )MBA *+ 1. What do you understand by management of earnings? Discuss its scope. 2. What do understand by retained 4retained earnings-? Discuss the merits and demerits of ploughing bac( of profits. !. “;etained earnings do not involve any cost. Do you agree? #. 3ow far do you agree that dividends are irrelevant? $. 0xplain the theories of dividend. &. 3ow do dividends affect the value of a share? ). @tate the various advantages of stability of dividends? /. Why stable dividend policy is dangerous? . ist the various constraints on =aying Dividends? 1. What are the preferences of shareholders? Do they want dividend income or capital gains? 11. What are the financial needs of the company? 12. 3ow much should be paid out as dividends? What are the constraints on paying dividends? 1!. @hould the company follow a stable dividend policy? 1#. What should be the form of dividends? 1$. What are the options available for Dividend decision? 1&. ist the various models available for ta(ing dividend decisions? 1). What do you mean by traditional approach to the dividend policy and what are its limitations? 1/. 3ow Walter *odel is different from ordon-s Dividend apitali+ation *odel? 1. 0xplain in detail about ordon-s Dividend apitali+ation *odel? 2. :naly+e critically of the :ssumptions of ** model in dividend decision? 21. What are the critical assumptions of *iller E *odigliani *odel? 22.